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China’s surging oil demand could pump up prices

President Barack Obama has pledged to address spiking gas prices — but he can’t do much to limit China’s impact on the market.

Adding to the already voracious demand coming from growing Asian countries, China in recent months has been stockpiling petroleum, anticipating that a confrontation between the United States and Iran will disrupt the flow of oil from the Middle East, which energy experts say has contributed to the rise.

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“Right now, the geopolitical aspect of oil has taken a lot of this out of Obama’s control,” said Phil Flynn, an energy analyst for the brokerage firm PFGBest. “The question isn’t so much what he can do to stop higher prices but what did he do to prepare for this inevitability — which is, nothing.”

Developing nations have pushed global oil supplies to their limits, sticking Americans with higher fuel costs and the government with few tools for addressing the immediate problem. That’s left little slack in the markets to absorb potential disruptions such as an embargo or military actions designed to thwart Iran’s nuclear program.

“The supply side of oil markets can’t keep up with demand from China and other emerging-market countries,” said Mark Zandi, chief economist at Moody’s Analytics. “Policymakers have limited options to bring down oil prices in the short term.”

Obama primarily blames Iran for the current gas spike — up 8 percent this month to $3.77 a gallon for regular unleaded gasoline — saying the difficulties with China and India are years down the road. But that’s not a complete picture of the situation said Stephen Schork, who analyzes the energy market for commodities traders as the editor of The Schork Report.

“Customers of Iranian oil have to become customers of someone else,” Schork said. “The United States has to compete with those other buyers. It’s Economics 101.”

Obama’s solution has been to diversify the mix of energy sources — natural gas, wind, solar and biofuels — “so we are not subject to the whims of what’s happening in other countries,” he said last week in New Hampshire. Republican lawmakers and presidential candidates, though, claim the best response to China involves more domestic drilling.

“We just have a tremendous amount of resources,” said Rep. Doc Hastings (R-Wash.), chairman of the House Natural Resources Committee. “The answer is to increase the supply that we have so we can better control the market as it relates to our consumers.”

Please read the article. The US is not CONSUMING as much oil as China. China is BUYING so much more oil that it is driving the increase in prices. Drilling has increased under Obama. So please explain to me how Democrats have caused China to increase the world's oil prices?

Please look at the charts again. The US is still the number one buyer of oil in the world by country. Not the charts have 2 different shades of yellow. The dark yellow is China's consumption; the light yellow is the emerging Asian markets. As for Chalons' comment, the Democrats weren't in power when we needed to put a plan together to fix the problem caused by China and India entering the market full bore. We've known for a good 10 to 12 years that China and India's growth would also lead to higher oil usage by these 2 countries with over a billion people in each. Yet neither the Bush Administration or the Republicans in Congress or the Democrats came up with and implemented a plan to help the American people weather the change in the market. Instead we got VP Dick Cheney's energy task force that figured how to get more money out of our pockets and into Oil companies coffers.

Looks like all those jobs sent overseas by Republicans (five million under Bush-Cheney alone) to India and China, etc. and our hundreds of billions in cheap imported Chinese goods are helping at least to create jobs overseas, helping people with upward mobility and to buy cars, and consume more. Corporations, with 43% or more of their income from overseas, have an allegiance to profit not countries. You do not hear Republicans say, "Buy American."

As I understand the situation a Democrat President named Carter created a group of government whiz kids when he was in office to elliminate our dependency on foreign oil. It seems after all the years those he appointed have retired with a lucrative government pension and the agency is bigger than ever through alternative Republican and Democratic administrations. As we read this article we are still dependent on foreign oil as the Oil Cartels planned.

If I were a Chinese businessman I would cut a deal with the Islamic Oil countries to trade oil for ammo and sell them all the arms and material they could buy. I would also provide them with the transportation by air,sea and land to wage their war on the "Great Satan" while suckin their oil supply dry. Could it happen ? I think it could in a New Your minute.